Exhibit
10.9


 


EXECUTION COPY


 


MANAGEMENT
AGREEMENT


 


THIS MANAGEMENT AGREEMENT
is made as of May 14, 2004, by and among, Bruckmann, Rosser, Sherrill
& Co., L.L.C. (“BRS”), RV Acquisition Inc., a Delaware corporation
(“Buyer”), LD Holdings, Inc., a Delaware corporation (“LDH”) and
Lazy Days’ R.V. Center, Inc., a Florida corporation (the “Company”).


 


1.                                       Appointment.  Each of Buyer, LDH and the Company hereby
engages BRS, and BRS hereby agrees pursuant to the terms and conditions set
forth herein, to provide certain services to Buyer, LDH, the Company and their
respective subsidiaries as described in Section 3 hereof.


 


2.                                       Term.  The term of the Agreement (the “Term”)
shall commence on the date hereof and shall continue until the tenth
anniversary of this Agreement.  Such
term shall be renewed automatically for additional one-year terms thereafter
unless BRS or the Company shall give notice in writing within 90 days before
the expiration of the initial term or any one-year renewal thereof of its
desire to terminate the Agreement.


 


3.                                       Duties
of BRS.  BRS shall provide the
Company and its subsidiaries with business and organizational strategy,
financial and investment management, advisory, and merchant and investment
banking services as the Company may reasonably request from time to time
(collectively, the “Services”). 
The Company shall use the Services of BRS and BRS shall make itself
available for the performance of the Services upon reasonable notice.  The Services will be provided at such times
and places as may reasonably be requested by the Company to meet its needs and
requirements, taking into account other engagements that BRS may have.  Notwithstanding anything in the foregoing to
the contrary, the following services are specifically excluded from the definition
of “Services”:


 


(i)                                     Independent
Accounting Services.  Accounting
Services rendered to Buyer, LDH, the Company, their respective subsidiaries or
BRS by an independent accounting firm or accountant (i.e., an accountant who is
not an employee of BRS); and


 


(ii)                                  Legal
Services.  Legal services rendered
to Buyer, LDH, the Company, their respective subsidiaries, or BRS by an
independent law firm or attorney (i.e., an attorney who is not an employee
of BRS).


 


(iii)                               Independent
Actuarial Services.  Actuarial services
rendered to Buyer, LDH, the Company, their respective subsidiaries, or BRS by
an independent actuarial firm or actuary (i.e.,
an actuary who is not an employee of BRS).


 


4.                                       Power
of BRS.  So that they may properly
perform their duties hereunder, BRS shall, subject to Section 7 hereof,
have the authority and power to do all things necessary and proper to carry out
the duties set forth in Section 3 hereof.


 

















 


5.                                       Compensation.  As consideration payable to BRS or any of
its respective affiliates for providing the Services to the Company, the
Company shall make the following payments to BRS.


 


(i)                                     During
the Term, the Company shall pay to BRS an annual management fee equal to the
greater of (x) $500,000 or (y) one and three quarters percent (1.75%) of Adjusted
EBITDA (as herein defined) (the “Management Fee”), plus the reasonable
out-of-pocket fees and expenses of BRS or any of its respective affiliates
(other than Buyer, LDH, the Company or any of their respective
subsidiaries).  The Management Fee shall
be payable semi-annually in advance by the Company in immediately available
funds on each January 3rd and July 2nd and each such semi-annual
payment shall be equal to the greater of (A) $250,000 (representing
one-half of $500,000) and (B) one and three quarters percent (1.75%) of
the budgeted Adjusted EBITDA, as determined by Buyer’s board of directors (the
“Board”), for the six month period commencing on the immediately
preceding January 1st if such Management Fee is to be paid on a
January 3rd, or the immediately preceding July 1st if such Management
Fee is to be paid on a July 2nd; provided
that the first payment of the Management Fee shall be payable on the date
hereof (such first payment shall be a pro-rated portion of the Management Fee
for the period beginning on the date hereof and ending on January 2, 2005
and shall be equal to one and three quarters percent (1.75%) of the budgeted
Adjusted EBITDA for such period, as determined by the Board; accordingly no
payment of the Management Fee shall occur on July 2, 2004).  For purposes of this Agreement, “Adjusted
EBITDA” means, for any period, (a) the net income of the Company and its
subsidiaries, on a consolidated basis, for such period (before the payment of
any dividends or other distributions and excluding the effect of any
extraordinary gains or losses during such period), plus (b) the interest
expense, operating lease expense related to construction and/or industrial
equipment, federal, state, foreign and local income, franchise, capital gain,
capital stock and other similar taxes, depreciation and amortization expense,
the Management Fee of the Company and its subsidiaries and the non-compete
payment to Donald W. Wallace (“Wallace”), on a consolidated basis, for
such period, in each case, determined in accordance with United States
generally accepted accounting principles consistently applied.  In the event that it shall be determined
following the end of a fiscal year of the Company, that the amount (such amount,
the “Actual Annual Management Fee”) equal to the greater of
(xx) $500,000 (which amount shall be appropriately pro rated for that
portion of such fiscal year during the Term if less than the full fiscal year)
and (yy) one and three quarters percent (1.75%) of Adjusted EBITDA for such
fiscal year (but only for that portion of such fiscal year during the Term), as
determined by the Board by reference to the Company’s audited financial
statements for such fiscal year, exceeds the amount of cash actually paid to
BRS as Management Fees for such fiscal year, then the Company shall promptly
pay an amount equal to such excess to BRS; and in the event that it shall be
determined following the end of a fiscal year of the Company that the
applicable Actual Annual Management Fee for such fiscal year is less than the
amount of cash actually paid to BRS as Management Fees for such fiscal year,
then an amount equal to such difference shall be offset against the next
payment payable to BRS hereunder. 
Notwithstanding the foregoing, the right of BRS to receive the
Management Fee payments pursuant to this Section 5(i), the right of
Wallace to receive payments pursuant to Section 5(iv) with respect to any
payment of a Management Fee and the ability of the Company to make the
Management Fee payments pursuant to this Section 5(i) shall be conditional
and contingent upon compliance by the Company and BRS with any covenants
concerning the payment of the Management Fee


 


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contained in any loan,
indenture or other agreement (including without limitation upon an occurrence
and continuation of an “Event of Default” as defined in the Second Amended and
Restated Floor Plan Credit Agreement dated May 14, 2004, among the Company,
Bank of America, N.A. and KeyBank National Association, as amended, modified,
and restated from time to time (the “FPCA”), which prohibits the payment
of a Management Fee at any time an “Event of Default” has occurred and is
continuing under the FPCA and upon an occurrence and continuation of an “Event
of Default” as defined in the Loan and Security Agreement dated May 14,
2004, between the Company and Wells Fargo Foothill, Inc., as amended, modified
and restated from time to time (the “LSA”), which prohibits the payment
of a Management Fee at any time an “Event of Default” has occurred and is
continuing under the LSA).  Neither BRS
nor Wallace will accept the payment of a Management Fee to be made by the
Company in violation of any loan, indenture, or other agreement (including
without limitation the FPCA and the LSA) and, if it or he, as applicable,
receives payment in violation of any loan, indenture or other agreement
(including without limitation the FPCA and the LSA), BRS or Wallace, as
applicable, will immediately refund such payment to the Company.  Each of BRS and Wallace acknowledges that
Wells Fargo Foothill, Inc. (and its successors in interest under the LSA), Bank
of America, N.A., and KeyBank National Association (and their successors in
interest under the FPCA) are relying on BRS’s and Wallace’s undertakings in
this Section 5(i).  Any Management
Fee payment to which BRS or Wallace has no right pursuant to the limitations of
the preceding sentence and that are not permitted to be paid by the Company
shall immediately become due and payable and shall be paid at the earlier of
the following:  (A) the time, if
any, that such unpaid Management Fee payments are permitted under the loan,
indenture or other applicable agreement; (B) the time of any transaction,
including in one or more series of related transactions, as a result of which
any third party or group of third parties acquires (I) directly or
indirectly, a majority of the voting securities of the Company (whether by
merger, consolidation, sale or transfer of any or all of the Corporation’s outstanding
capital stock), or (II) all or substantially all of the Company’s assets
determined on a consolidated basis, LDH or Buyer (collectively, a “Sale
Event”); (C) the time of any recapitalization of the Company, LDH or
Buyer; and (D) the time (I) a court or governmental agency having
jurisdiction in the premises shall enter a decree or order for relief in
respect of the Company, LDH or Buyer in an involuntary case under any
applicable bankruptcy, insolvency or other similar law, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
the Company, LDH or Buyer or for any substantial part of any of their
respective property or ordering the winding up or liquidation of any of their
respective affairs; or (II) the Company, LDH or Buyer shall commence a
voluntary case under any applicable bankruptcy, insolvency or other similar
law, or consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Company, LDH or Buyer or for any substantial part of any of
their respective property or make any general assignment for the benefit of
creditors.


 


(ii)                                  During
the Term, BRS shall be entitled to receive from the Company a transaction fee
in connection with the consummation by Buyer, LDH, the Company or any of their
respective subsidiaries of (i) each material acquisition of an additional
business, (ii) each material divestiture, including, without limitation, a
Sale Event, and (iii) each material financing or refinancing, in each
case, in an amount equal to one and one half percent (1.5%) of the


 


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aggregate value of such
transaction (each such payment, a “Transaction Fee”) plus all reasonable
out-of-pocket fees and expenses of BRS or any of its affiliates (other than
Buyer, LDH, the Company or any of their respective subsidiaries) in connection
with any such transaction.


 


(iii)                               On
the date hereof, in consideration for BRS’ efforts in obtaining and negotiating
the Company’s debt financing and related agreements, the Company shall
(x) pay to BRS a closing fee equal to $3,500,000 (the “Closing Fee”),
and (y) either pay directly or reimburse BRS for all of the reasonable
out-of-pocket fees and expenses, including legal and accounting fees, incurred
by BRS or any of its affiliates (other than Buyer, LDH, the Company or any of
their respective subsidiaries) in connection with the negotiation and execution
of the debt and equity financing and related agreements entered into by Buyer,
LDH and/or the Company on or about the date hereof.


 


(iv)                              Notwithstanding
the foregoing, with respect to any payment of (A) a Management Fee to BRS,
or (B) the Closing Fee to BRS, eighty-nine and four tenths percent (89.4%)
of such respective payment shall be made to BRS and ten and six tenths percent
(10.6%) of such respective payment shall be made to Wallace.


 


6.                                       Indemnification.  In the event that BRS or any of its
affiliates, principals, partners, directors, stockholders, employees, agents
and representatives (collectively, the “Indemnified Parties”) becomes
involved in any capacity in any action, proceeding or investigation in
connection with any matter referred to in or contemplated by this Agreement, or
in connection with its Services, the Company will indemnify and hold harmless
the Indemnified Parties from and against any actual or threatened claims,
lawsuits, actions or liabilities (including out-of-pocket expenses and the fees
and expenses of counsel and other litigation costs and the cost of any
preparation or investigation) of any kind or nature, arising as a result of or
in connection with this Agreement and its Services, activities and decisions
hereunder, and will periodically reimburse BRS for its expenses as described
above, except that the Company will not be obligated to so indemnify any
Indemnified Party if, and to the extent that, such claims, lawsuits, actions or
liabilities against such Indemnified Party directly result from the gross
negligence or willful misconduct of such Indemnified Party as admitted in any
settlement by such Indemnified Party or held in any final, non-appealable
judicial or administrative decision.  In
connection with such indemnification, the Company will promptly remit or pay to
BRS any amounts which BRS certifies to the Company in writing are payable to
BRS or other Indemnified Parties hereunder. 
The reimbursement and indemnity obligations of the Company under this
Section 6 shall be in addition to any liability which the Company may
otherwise have, shall extend upon the same terms and conditions to any
Indemnified Party, as the case may be, of BRS and any such affiliate and shall
be binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the Company, BRS, and any such Indemnified
Party.  The foregoing provisions shall
survive the termination of this Agreement.


 


7.                                       Independent
Contractors.  Nothing herein shall
be construed to create a joint venture or partnership between the parties
hereto or an employee/employer relationship. 
BRS shall be an independent contractor pursuant to this Agreement.  No party hereto shall have any express or
implied right or authority to assume or create any obligations on behalf of or
in


 


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the name of any other
party hereto or to bind any other party hereto to any contract, agreement or
undertaking with any third party.


 


8.                                       Liability.  BRS is not and never shall be liable to any
creditor of Buyer, LDH or the Company, and Buyer, LDH and the Company agree to
indemnify and hold each Indemnified Party harmless from and against any and all
such claims of alleged creditors of the Company and against all costs, charges
and expenses (including reasonable attorneys fees and expenses) incurred or
sustained by any Indemnified Party in connection with any action, suit or
proceeding to which it may be made a party by any alleged creditor of the
Company.  Notwithstanding anything
contained in this Agreement to the contrary, Buyer, LDH and the Company agree
and acknowledge that BRS and its partners, principals, shareholders, directors,
officers, employees and affiliates intend to engage and participate in
acquisitions and business transactions outside of the scope of the relationship
created by this Agreement and they shall not be under any obligation whatsoever
to make such acquisitions, business transactions or other opportunities through
Buyer, LDH, the Company or any of their respective subsidiaries or offer such
acquisitions, business transactions or other opportunities to Buyer, LDH, the
Company or any of their respective subsidiaries.  In addition, nothing herein shall in any way preclude BRS or its
partners, principals, shareholders, directors, officers, employees and
affiliates from engaging in any business activities or from performing services
for its or their own account or for the account of others, including, without limitation,
companies which may be in competition with the business conducted by the
Company.


 


9.                                       Notices.  Any notice or other communications required
or permitted to be given hereunder shall be in writing and delivered by hand or
mailed by registered or certified mail, return receipt requested, or by
telecopier to the party to whom it is to be given at its address set forth
herein, or to such other address as the party shall have specified by notice
similarly given and the mailing date shall be deemed the date from which all
time periods pertaining to a date of notice shall run.


 


(i)                                     If
to the Company :


 


Lazy Days’ R.V.
Center, Inc.


6130 Lazy Days
Boulevard


Seffner, Florida
33584


Attention: Charles
Thibault


Tel: (813)
246-4333


Fax: (813)
246-5240


Email: clthibault@lazydays.com


 


(ii)                                  If
to BRS:


 


c/o Bruckmann,
Rosser, Sherrill & Co., Inc.


126 East 56th
Street


New York, NY 10022


Attention:  Thomas J. Baldwin


Tel:  212-521-3700


Fax:  212 521-3799


E-mail:  Baldwin@brs.com


 


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with a copy (which
shall not constitute notice to BRS) to:


 


Kirkland &
Ellis LLP


Citigroup Center


153 East 53rd
Street


New York, NY
10022-4675


Attention: Kim
Taylor


Tel:  212-446-4800


Fax:  212-446-4900


Email:  ktaylor@kirkland.com


 


10.                                 Assignment.  No party hereto may assign any of its rights
or obligations hereunder without the prior written consent of the other parties
hereto; provided that
notwithstanding the foregoing, BRS may assign its rights and obligations under
this Agreement to any of its affiliates without the consent of Buyer, LDH or
the Company.


 


11.                                 Successors.  This Agreement and all the obligations and
benefits hereunder shall inure to the successors and permitted assigns of the
parties hereto.


 


12.                                 Headings;
Counterparts.  The section headings
contained herein are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.  This Agreement may be executed and delivered
by the parties hereto in separate counterparts, each of which when so executed
and delivered shall be deemed an original and both of which taken together
shall constitute but one and the same agreement.


 


13.                                 Severability.  Any section, subsection, clause, sentence,
provision, subparagraph or paragraph of this Agreement held by a court of
competent jurisdiction to be invalid, illegal or ineffective shall not impair,
invalidate or nullify the remainder of this Agreement, but the effect thereof
shall be such section, subsection, clause, sentence, provision, subparagraph or
paragraph so held to be invalid, illegal or ineffective.


 


14.                                 Entire
Agreement; Modification; Governing Law; Jurisdiction; Venue; Waiver of Jury
Trial.  The terms and conditions
hereof constitute the entire agreement between the parties hereto with respect
to the subject matter of this Agreement and supersede all previous
communications, either oral or written, representations or warranties of any
kind whatsoever, except as expressly set forth herein.  No modifications of this Agreement nor
waiver of the terms or conditions hereof shall be binding upon any party hereto
unless approved in writing by an authorized representative of such party; provided that Section 5 of this
Agreement shall not be modified in a manner that adversely and prejudicially affects
Wallace, without the prior written consent of Wallace.  All issues concerning this Agreement shall
be governed by and construed in accordance with the laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or rule (whether of the State of New York or any other jurisdiction) that would
cause the application of the law of any jurisdiction other than the State of
New York.  Each of the parties hereto
hereby irrevocably submits to the exclusive jurisdiction of any Federal court
sitting in the Southern District of New York over any suit, action or
proceeding arising out of or relating to this agreement.  Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted or not prohibited by law,
any objection which it may now or hereafter


 


6

















 


have to the laying of the
venue of any such suit, action or proceeding brought in such a court and any
claim that any such suit, action or proceeding brought in such a court has been
brought in an inconvenient forum.  Each
of the parties hereto hereby irrevocably consents to the service of process in
any suit, action or proceeding by sending the same by certified mail, return
receipt requested or by overnight courier service, to the address of such party
set forth in Section 9 or in the records of the Company.  EACH PARTY HERETO WAIVES ANY RIGHT IT MAY HAVE TO
TRIAL BY JURY IN ANY ACTION BROUGHT HEREUNDER OR ARISING OUT OF THE
TRANSACTIONS CONTEMPLATED HEREBY.


 


15.                                 No
Third Party Beneficiaries.  Except
as provided in Section 6 and Section 8 hereof, this Agreement is for
the sole benefit of the parties hereto and their permitted assigns and nothing
herein expressed or implied shall give or be construed to give to any person,
other than the parties hereto and such assigns, any legal or equitable rights
hereunder.  Notwithstanding the
foregoing, Wallace shall be a third-party beneficiary for purposes of
Section 5 of this Agreement and each of Wells Fargo Foothill, Inc., as
lender (and its successors in interest under the LSA), Bank of America, N.A.,
as agent and lender, and KeyBank National Association, as lender, (and their
successors in interest under the FPCA) shall be a third-party beneficiary for
purposes of Section 5(i) of this Agreement.


 


16.                                 Obligations
of Buyer, LDH and the Company.  The
obligations of the Company are jointly and severally guaranteed by Buyer and
LDH.


 


*     *    
*     *     *


 


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IN WITNESS WHEREOF, the
parties hereto have signed this Management Agreement as of the day and year
first above written.


 


	
   

  	
  BRUCKMANN, ROSSER,
  SHERRILL & CO., L.L.C.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tom Baldwin

  
	
   

  	
   

  	
  Name: Tom Baldwin

  
	
   

  	
   

  	
  Title: Managing
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  RV ACQUISITION INC. a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John Horton

  
	
   

  	
   

  	
  Name: John Horton

  
	
   

  	
   

  	
  Title: Chief Operating
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LD HOLDINGS, INC. a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Charles L. Thibault

  
	
   

  	
   

  	
  Name: Charles L.
  Thibault

  
	
   

  	
   

  	
  Title: Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LAZY DAYS’ R.V. CENTER,
  INC. a Florida corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Charles L. Thibault

  
	
   

  	
   

  	
  Name: Charles L.
  Thibault

  
	
   

  	
   

  	
  Title: Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ACKNOWLEDGED:

  
	
   

  	
   

  
	
   

  	
  /s/ Donald W. Wallace

  
	
   

  	
  DONALD W. WALLACE

  



 


 


[Signature
Page to Management Agreement]